5.8 SHARE CAPITAL

In accordance with the Articles of Association, as of 31 December, 2010, the share capital of Federal Grid Company stood at RUR 616,780,666,776, divided into 1,233,561,333,552 ordinary registered non-documentary shares with a nominal value of RUR 0.50 per share.

The number of authorized shares is 113,244,490,279 ordinary registered shares with a nominal value of RUR0.50 per share worth a total of RUR56,622,245,139.50 (nominal value). Authorized shares have the same rights as issued ordinary shares.

No preferred shares were placed.

On 4 February the Company completed placing an additional issue of ordinary shares with a price of RUR0.5 per share. A total of 22,386,794,841 shares were placed via the additional issue, representing 79.14% of available shares. The placement generated RUR11.193 billion for the Company.

The main participant in the additional share issue was the Russian Federation, which acquired shares worth RUR11.189 billion. The remaining part of placed shares, worth RUR4.147 billion, was purchased by minority shareholders.

Proceeds from the additional share issue will be used to upgrade the reliability of power sector facilities in the Sochi Region ahead of 2014 Olympic Games preparation and to implement “Economic and social development of the Russian Far East and Trans-Baikal for the period to 2013” Federal Target Program.

On 25 March, 2011, the Company registered amendments to its Articles of Association under which share capital totals RUR627,974,064,196.50 (six hundred twenty-seven billion nine hundred seventy-four million sixty-four thousand one hundred and ninety-six) and 50 kopecks.

State registration number for the issue State registration date and issue Placement price Placement method Number of issued shares Total number of shares (following the additional share issue)) Registration date for reporting on the issue results
1-01-65018-D 10.09.2002 RUR0.5 Distribution among company founders 243 214 483 559 243 214 483 559 10.09.2002
1-01-65018-D-001D 21.03.2006 RUR0.5 Closed subscription placement to RAO UES of Russia 118 167 724 361 361 382 207 920 15.05.2007
1-01-65018-D-002D 23.08.2007 RUR0.59 Closed subscription placement to RAO UES of Russia and Federal Agency for State Property Management 114 965 254 23 476 347 462 155 18.04.2008
1-01-65097-D-097D 03.06.2008 - Conversion upon merger 737 588 491 911 1 153 514 196 362 12.08.2008
1-01-65098-D-098D 03.06.2008 - Conversion upon merger 34 154 626 385 1 153 514 196 362* 12.08.2008
1-01-65018-D-101D 25.12.2008 RUR0.51 for open subscription Open subscription 80 047 137 190 1 233 561 333 552 26.01.2010
RUR0.5 for entities with pre-emptive rights
1-01-65018-D-102D 12.08.2010 RUR0.5 for open subscription Open subscription 22 386 794 841 1 255 948 128 393 01.03.2011
RUR0.5 for entities with pre-emptive rights

* 94,576,384,089 shares were redeemed (annulled).

Number of the Company’s Shareholders as of 31 December, 2010

Number of holders Number of shares % of the total number of shares
Number of individuals registered in the shareholder register 412 775 10 549 483 174 0,84
Number of legal entities registered in the shareholder register (including nominee holders, trust managers and the Issuer’s issuer account) 1 458 1 251 239 357 525 99,6251
nominee holders 65 246 236 484 889 19,6056
trust managers 6 5 101 036 0,0004
Issuer’s issuer account 1 5 901 991 179 0,4699
Number of separate accounts for accounting for securities in joint shared ownership 1 711 61 265 519 0,0049
Number of separate accounts for accounting for securities of undisclosed entities 1 3 922 0
Total number of entities registered in the shareholder register 415 945 1 261 850 110 141 100

List of Registered Entities That Hold More Than 2% of Accountable Shares in Their Individual Accounts as of 31 December, 2010

¹ Registered entity type Name Number of shares Share of share capital, %
1 Owner The Russian Federation, represented by the Russian Federation Agency for State Property Management 998 216 115 886 79,48
2 Nominee holder Depository Clearing Company 79 451 549 039 6,33
3 Nominee holder Depository and Corporate Technologies 67 916 184 242 5,41
4 Nominee holder Non-banking Credit Organization “National Settlement Depository” 59 513 606 178 4,74
5 Nominee holder ING BANK (EURASIA) 27 076 780 253 2,16

Information about the Registrar

 In December 2010, due to a decision by the Russian Federal Financial Markets Service to cancel the register-maintaining license of Central Moscow Depository, the Company decided to cancel its agreement with Central Moscow Depository (CMD) on keeping and storing the Register of Owners of Nominal Securities. Since February 2011 the Company’s Registrar has been STATUS Registrar Company, which was selected via an open tender.

Location:
32 Novorogozhskaya Street, bld 1, Moscow, Russia, 109544

Mailing address:
32 Novorogozhskaya Street, Bld 1, Moscow, Russia, 109544

Telephone: +7 495 974 8350

Fax: +7 495 678 7110

Email:
info@rostatus.ru/p>

License No:
10-000-1-00304

Issue date:
12.03.2004

Valid through:
Unlimited

Issuing authority:
The Federal Financial Markets Service (FFMS)

The share of foreign investors in Federal Grid Company’s share capital stood at 5.78% as of 31 December, 2010.

Most of the foreign buy-side investors continue to view the Company’s shares as promising, with the growth rates for the Company’s profit and/or share value exceeding average levels for other companies in the same industry. One-third of the investment is so-called “index investors” (29%), another 27% comes from investors who believe the Company’s shares are currently heavily undervalued. Hedge funds account for only 0.33%, after seeing a marked decline (16.87%), which is generally seen as a positive.

Geographical breakdown of foreign investors

Foreign investors by investing style